What is the most rewarding aspect of your role?
Venture investing combines many skill sets - understanding market opportunities, ensuring you mitigate risk to your capital and judging the ability of the founders to deliver on their vision. Seeing a business scale up from an excel business plan through the efforts of its founders is for me the most enjoyable and rewarding aspect of my job.
One example is when we came up with the idea of creating a new independent rights business - we built the plan and identified the person to run it. The CEO recruited the first employees and at that time, I met everyone and signed every payment off. It was very hands on investing and very exciting to see how something can grow to scale. That business is now DRG, which was acquired by a major broadcaster and has a turnover of £25m. It’s a significant rights business. I still think back to the most difficult decision: coming up with its name ('Digital Rights Group') - for which I take no credit, as our lawyer thought of that!
What's keeping you up at night?
Nothing - except the dogs at home barking when a fox comes into the garden, or being served a decaffeinated coffee at night and discovering it is the opposite. The serious point though is that business and investing is full of all sorts of challenges. As a leader it is important to be able to sleep and rest - fatigue and worry does not make for good decision making. So getting a good night's sleep is a must.
"Life is a marathon not a sprint. And that is the same for venture investing.."
What are three areas of focus for your firm this year?
Our first key areas of focus is to raise our profile within the adviser/private investor community as a specialist investor. Station12 has historically funded investments through its balance sheet and private network, rather than through EIS and financial intermediaries. We’ve entered the EIS market now as a result of the Patient Capital Review, which emphasises the need to utilise our style of venture investing.
We will also be significantly expanding the team throughout the year, bringing in experienced investment professionals and venture capitalists with domain experience of our sectors. This will enable us to further extend our networks and uncover new opportunities.
Our final area of focus is to expand our product offering and funds under management to include non-tax based funding.
What is the one thing that you would like advisers/investors to know about your firm?
Station12 is a specialist investor with a demonstrable track record of successful venture investment. Whilst a high number of opportunities come into us via our website and emails, we rarely act on these. We source opportunities by using our own proprietary networks. Our Advisory Board members also have extensive networks so are able to assist us in sourcing opportunities within the Sports, Entertainment, Immersive and Knowledge sectors.
Station12 has a corporate finance arm which assists businesses when they are ready to sell. This provides us with valuable market intelligence in the identification of possible market gaps and access to new investment opportunities. It also enables us to understand what the big conglomerates - who will be the buyer of our investee companies - are thinking about in terms of future strategy.
What recent investment opportunity has caught your eye and why?
We have been appointed by Innovate UK as an Investor Partner to the government funded Immersive UK Accelerator programme which focuses on VR, AR and mixed reality. Through our involvement, we have had access to a multitude of emerging companies which have highlighted the potential uses of immersive technology across a number of sectors. One of these is a company that has created an intuitive 3D design tool which enables designers to visualise their concepts in real life. This technology has the potential to revolutionise the way in which objects are designed in certain industries including car manufacture and furniture design. These immersive opportunities have been made available to us as a direct result of our partnership with Innovate UK.
How have the recent legislative changes affected your firm?
The recent legislative changes ('Patient Capital Review') are only a positive for Station12. We have always been a specialist venture capitalist investor so the changes haven’t had an effect on the way in which we operate; we have not had to pivot to adapt to the new guidelines. The changes set out by the government in late-2017 have forced providers to use EIS as it was first intended and has removed the ‘capital preservation’ and credit/cash flowing strategies from the market. As such, I felt it was now the right time for Station12 to launch its SEIS/EIS opportunity given our style of investment is completely aligned to the new guidelines. We are investors first - the tax benefits are for our investors, our job is to find successful companies and make good returns for our investors.
What is the best piece of advice you've taken?
What non-fiction book would you recommend?
'The Second Bounce of the Ball' by Ronnie Cohen - the co-founder of Apax, Ronnie writes clearly about how risk can be transformed into opportunity. Anyone interested in ventures, or business generally, should read his book.
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Station12’s team combines operational, investment and advising experience, giving us a unique and deep understanding of the Sports, Entertainment and Knowledge sectors. Station 12 have worked across television, advertising, music and film, as well as leading investments in these sectors, together with gaming, sports, live events and theatre.
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